In 1939, Congress first authorized the Social Security Administration (SSA) to make benefit payments to another person or organization (aka a representative payee) when a beneficiary is not capable of managing his or her own Social Security benefits.

Representative payees are required for adults judged legally incompetent by a State court and for most minor children. Most legally competent adult beneficiaries do not require payees, however, a competent adult unable to manage or direct the management of his or her own benefits may require a payee. As of the end of 2016, 8.8% of all beneficiaries required a representative payee. While that may seem small, it equates to ~5.3 million people.

Typically, SSA will first consider the beneficiary’s family and friends for the payee position. Where such support networks do not exist, SSA may rely upon state, local or other community resources instead. Payees are NOT allowed to collect a fee for services performed. However, very limited exceptions exist for certain organizations who must file a separate application (SSA-445) to obtain authorization to collect a fee.

A payee has significant responsibilities to the beneficiary and to SSA. The payee’s responsibility to the beneficiary is to decide how benefits should be spent to secure him or her a stable living environment. This should ensure that the beneficiary’s food, shelter, clothing and medical care needs are met. If any funds are leftover, they should be saved for the beneficiary’s future use. At least once per year, the payee must report how benefits were used or saved. Thus, it is important the payee keep a record of deposits and expenses for each beneficiary served.

Additionally, the payee must report to SSA any changes that would impact the beneficiary’s entitlement to benefits or payment amount. This includes whether the beneficiary moves, dies, divorces, changes his or her name, starts or stops working, changes his medical status, is incarcerated, is overpaid, or no longer needs a representative payee.

This list of responsibilities is not comprehensive. Many other issues can arise while acting as a payee. Moreover, the nature of the benefits payable can alter how a representative payee may act. For example, the nature of Social Security Disability (“SSD”) and Supplemental Security Income (“SSI”) is very different. Thus, it is important that a representative payee understand the nature of the benefits payable to his or her beneficiary.

The Strengthening Protections for Social Security Beneficiaries Act of 2018:

Changes to the representative payee program last took place 14 years ago. In the interim, significant concerns have been raised about the SSA’s management of the program.

Congress recently passed the Strengthening Protections for Social Security Beneficiaries Act of 2018. This bill was signed into law on April 13, 2018, the effective date. The Act will:

Increase oversight of representative payees by increasing the number of performance reviews of payees.

Eliminate the requirement to file the annual accounting form for representative payees who are parents living with their child or who are spouses

Require SSA to identify whether a beneficiary is in foster care and reassess whether the payee is appropriate, and direct SSA to study how better to coordinate with Adult protective Services and with state guardianship courts.

Allow beneficiaries to make a designation of their preferred payee in advance and require SSA to assess the appropriateness of the order of preference list it uses to select payees.

Codify the policy that bans individuals with certain criminal convictions from serving as payees and prohibiting individuals who have payees from serving as a payee for others.

Limit overpayment liability for children in the child welfare system.

SSA may be contemplating other changes to the representative payee system. Among other things mentioned by the Social Security Advisory Board, it recommended the Office of Management and Budget study how best to coordinate the management of federal benefits for people who have been determined to be financially incapable, with the recognition of alternative approaches such as Supported Decision Making.

Taking on responsibility as a representative payee can seem daunting. To address this, SSA provides several resources and publications for guidance. This includes online publications outlining the representative payee obligations (whether an individual or organization) as well as the opportunity to maintain accounting through SSA’s website. Such resources can be found here: (https://www.ssa.gov/payee/NewGuide/toc.htm). When in doubt, you can call Social Security at 1-800-772-1213 or visit your local SSA District Office.

The Social Security Administration (“SSA”) does much more than pay retirement benefits to eligible workers. For example, SSA pays disability insurance benefits to eligible workers who cannot work due to an illness or injury and auxiliary benefits to the minor children of these disabled workers.

You and your loved ones may be eligible for these lesser known benefits.

Social Security Disability (“SSD”) Benefits

You are disabled (and eligible for SSD) if you are unable to work due to a physical or mental impairment which has lasted, or can be expected to last, for 12 months. Your impairments must prevent you from performing your usual work AND other work considering your age, education and work experience

To be eligible for SSD, you also must have paid into the Social Security system for at least five out of the ten years before your disability began. During this period, you and your employer must have paid required Social Security taxes.

The amount of your SSD benefit depends on how much you and your employer have paid in Social Security taxes. You can get an estimate of your SSD benefit online at: http://www.ssa.gov/mystatement

Auxiliary Benefits

Minor children may be eligible for an auxiliary benefit if you collect SSD. A biological or adopted child 18 years old or younger (or who is 19 years old AND still in high school) ordinarily is eligible for an auxiliary benefit.

The auxiliary benefit usually is 50% of the amount of the SSD benefit and the aggregate paid to all eligible minor children. To illustrate, one eligible minor child collects 50% of the SSD benefit; two eligible minor children collect half of the auxiliary benefit so that the total amount paid to them does not exceed 50% of the SSD benefit.

Supplemental Security Income (“SSI”) Benefits

SSI benefits are payable to adults and children who are disabled (using the same criteria used for SSD) AND who have very limited income and resources. SSI benefits also are payable to individuals who are 65 and older without disabilities who meet the financial rules.

A person can be eligible for SSI benefits without ever working and paying Social Security taxes. The amount of the SSI benefit depends on the recipient’s living situation (people living alone collect less than people who live as part of a family) and contribution from the federal and state governments.

Disabled Adult Child (“DAC”) Benefits

An unmarried adult who becomes disabled before age 22 may qualify for DAC benefits based on the work and earnings record of their biological or adopted parent. To be eligible, at least one of the parents must be deceased or be collecting SSD or Social Security retirement benefits.

The amount of the DAC benefit is based on the work and earnings record of the salient parent.

Spousal Benefits

Someone age 62 or older who has never worked and paid Social Security taxes may qualify for a Social Security benefit (regardless of health) based on the work and earnings record of a current or former spouse. Further (and regardless of age), a person may collect spousal benefits if they are caring for a child who is collecting Social Security benefits.

The amount of the spousal benefit depends on when the person begins to collect and the work and earnings record of the “wage earning” spouse. A person who waits to collect the spousal benefit until their full Social Security retirement age (which depends on the year they were born) may collect up to one half of the full Social Security retirement benefit of the wage-earning spouse.

Survivor Benefits

A widow or widower–and some surviving divorced spouses (if the marriage lasted at least 10 years)–may collect a reduced survivor benefit as early as age 60 or a full survivor benefit at their full Social Security retirement age. They also may collect a survivor benefit as early as age 50 if they are disabled and their disability started before or within seven years of the death of their spouse.

An unmarried biological or adopted child who is 18 years old or younger (or who is 19 years old AND still in high school) can collect survivor benefits. The amount of the survivor benefit for an eligible child is 75% of the benefit of the deceased worker.

Dependent parents who are 62 or older may be eligible for survivor benefits if the deceased worker provided at least half of their support. The survivor benefit for one parent is 82.5% of the benefit of the deceased worker. If two parents survive, each parent is entitled to a survivor benefit equal to 75% of the benefit of the deceased worker.

Under the Social Security Act, you are disabled (and thus eligible for SSD) if you are unable to work due to a physical or mental impairment which has lasted, or can be expected to last, for at least 12 months. You will be considered disabled if your impairments are so severe that you cannot perform your usual work AND cannot perform other work given your age, education and work experience.

Not only must you be disabled to qualify for benefits, you must have paid into the Social Security system for the required period. Generally, you must have worked at least five out of the ten years before the disability began. During this period, you and your employer must have paid required social security taxes.

How Substance Abuse Impacts an SSD Claim:

20 CFR 416.0935 addresses how the Social Security Administration (“SSA”) determines whether substance abuse is “a contributing factor material to the determination of disability.” If SSA finds that a claimant is disabled but there is evidence of substance abuse, it must determine whether it is a contributing factor material to the determination of disability.

The key factor is whether SSA would still find a claimant disabled if he stopped using drugs or alcohol. If SSA determines that the remaining limitations are disabling, the claimant will be deemed disabled independent of the substance abuse. In other words, the drug addiction or alcohol abuse is not a contributing factor material to the determination of disability.

Policy Interpretation Ruling:

In March 2013, SSA issued SSR 13-2p, a policy interpretation ruling regarding evaluating cases involving drug addiction and alcoholism (“DAA”). SSA makes a DAA determination only when it has medical evidence from an acceptable medical source establishing that a claimant has a substance abuse disorder and it finds the Claimant is disabled considering all impairments, including the DAA.

Notably, SSA does not decide materiality if a Claimant has a history of DAA that is not relevant to the period under consideration. However, a Claimant bears the burden of proving disability throughout SSA’s sequential evaluation process.

DAA Evaluation Process:

The DAA Evaluation Process has a series of six steps. However, the adjudicator may go through them in any order.

Step 1–Does Claimant have DAA? If NO, there is no DAA materiality determination. If YES, go to step 2.

Step 2–Is Claimant disabled considering all impairments, including DAA? If NO, there is no DAA materiality determination because the claim is denied. If YES, go to step 3.

Step 3–Is DAA the only impairment? If YES, DAA is material and the claim is denied. If NO, go to step 4.

Step 4–Is the other impairment(s) disabling by itself while Claimant is dependent upon or abusing drugs or alcohol? If NO, DAA is material and the claim is denied. If YES, go to step 5.

Step 5–Does the DAA cause or affect Claimant’s medically determinable impairment(s)? If NO, DAA is not material. If YES, but the other impairment(s) are irreversible or could not improve to the point of non-disability, DAA is not material. If YES and DAA could be material, go to step 6.

Step 6–Would the other impairment(s) improve to the point of non-disability in the absence of DAA? If YES, DAA is material and the claim is denied. If NO, DAA is not material.

Conclusion:

Claims for SSD benefits can be long and frustrating. DAA issues may add another layer to an already complicated and confusing process. However, DAA issues must be properly evaluated by SSA to determine whether they are material to the period at issue. Thus, Claimants with DAA issues may still be awarded SSD benefits. If you or someone you love has DAA issues, we urge you/them to stop using drugs and alcohol and seek professional treatment.

Most people think of Social Security as benefits received after retirement. Social Security is much more. For example, Social Security provides disability insurance benefits for injured workers, and sometimes their families, if the worker is disabled within the meaning of the Social Security Act [“SSA”].

Who is Eligible to Collect Social Security Disability [“SSD”] Benefits?

Under the SSA, you are disabled (and thus eligible for SSD) if you are unable to work due to a physical or mental impairment which has lasted, or can be expected to last, for at least 12 months. You will be considered disabled if your impairments are so severe that you cannot perform your usual work AND cannot perform other work given your age, education and work experience.

Selected family members also may be eligible for benefits if you are found eligible for benefits. For example, if you have one or more children who are 18 years old or younger (or who are 19 years old or younger AND in high school), they are eligible for benefits as an extension of your own SSD benefit. An unmarried child who is at least 18 years old is eligible for benefits if that child has a disability that began before age 22. Your spouse is eligible for benefits if he or she is at least 62 years old. Finally, if your spouse is caring for your disabled child who is 16 years old or younger, your spouse is eligible.

Not only must you be disabled to qualify for benefits, you must have paid into the Social Security system for the required period of time. As a general rule, you must have worked at least five out of the ten years before the disability began. During this period, you and your employer must have paid required social security taxes.

How Much is my SSD Benefit?

The amount of your benefit depends on how long you have worked and how much money you have paid into the Social Security system. Until recently, Social Security sent a statement to you each year showing your estimated SSD benefit. They stopped doing this to save money.

Information Required: (a) E-mail Address; (b) Social Security number; (c) U.S. Mailing Address; and (d) you must be more than 18 years old. You will be asked for your phone number and will have an option to receive a text message anytime your account is logged into.

When Should You Apply for SSD?

You are NOT required to wait 12 months before applying for SSD benefits. As soon as it becomes evident that you will not return to your regular job, and will not be able to do another job, you should apply for benefits. Many times the process can take years, so the sooner an application for benefits is filed the sooner you will be awarded SSD benefits.

What About Other Benefits?

SSD benefits are coordinated with other benefits that you may collect. For example, if you became disabled due to an on-the-job injury, you probably collected workers’ compensation [“WC”] benefits for a period of time. Under federal law, you may not collect more than 80% of your annual pre-disability earnings when you add together the amount of your WC and SSD benefits. This is just one of many complex coordination of benefit rules.

If you are awarded SSD benefits, you are also automatically entitled to participate in the government health and hospital insurance program which is called Medicare. There is a two year waiting period, however, before you can participate in Medicare. Eligibility for Medicare is especially important if you do not otherwise have health insurance coverage.

Maintaining health insurance coverage–and getting appropriate medical treatment–is very important until you can transition onto Medicare. We encourage you to explore whether you are eligible for “affordable” health insurance coverage under a federal law known as the Affordable Care Act. Residents of New York can learn more by visiting http://nystateofhealth.ny.gov/

What if Your Initial Application for Social Security benefits is denied?

Statistically speaking, the initial application of about seventy percent (70%) of the people who apply for SSD is DENIED. Some give up at this stage because they believe that they will be unable to prevail if they go forward. This is not true.

If your initial application is denied, you can request a hearing before an administrative law judge. At this hearing, you are required to prove that you are entitled to benefits. Statistically speaking, claimants win about fifty-four percent (54%) of the cases that are decided AFTER a hearing (after deducting out cases that are dismissed). Claimants represented by experienced lawyers win in even greater percentages.

Professional Services in SSD Cases

If your application for SSD is denied, we believe that you should hire an experienced lawyer to assist you. An experienced lawyer will answer your many questions about the process, will protect your appeal and other rights, will secure relevant medical and employment records, will develop a viable legal theory and will prepare you thoroughly for your hearing. Thereafter, the lawyer will deal with many issues that can arise after a hearing, including whether you are collecting the appropriate amount of money.

Social Security law is very complex. Proper interpretation requires knowledge in several areas other than the law. To illustrate, one must be familiar with medicine, medical terminology and the description and physical demands of various jobs. An experienced lawyer will know how to cross examine a vocational expert hired by Social Security to help the Judge decide your case.

What Do Attorneys Charge for their Services?

Most law firms that represent claimants in SSD cases will represent you on a contingent fee basis. This means that there is no fee owed to the law firm if you lose your case.

If your case is successful, the usual contingent fee is twenty-five percent (25%) of the lump sum of benefit that is paid to you AND your family BUT NOT more than the maximum permitted by law. Effective June 22, 2009, the maximum fee permitted by law is $6,000.

You are never paid for the first five months that you are disabled. This is a waiting period that is set forth by law. For example, if you were found disabled as of January 1, 2017, the first month that you would be entitled to payment would be June 2017. If your case was resolved in June 2018, you would be entitled to payment of a lump sum of benefits equal to 12 months of your usual monthly benefit. Our fee would be 25% of that lump sum of benefit but NOT more than the maximum fee permitted by law. This applies to all money paid on your claim, even money paid to your children.

We are prohibited by law from paying out-of-pocket expenses incurred to prosecute your claim. In the past, the most significant expense was the cost charged by doctors to secure your medical records (75 cents/page). Recently, New York passed a law which prohibits doctors from imposing this charge when a person is requesting them to apply for public benefits like SSD. Thus, we expect to incur virtually no expenses for which you will be responsible.

Social Security regulations require that attorneys’ fees be approved by the Social Security Administration prior to payment. In most cases, the attorneys’ fee is withheld from the lump sum of benefits owed to you.

A Final Thought

We know that this process is difficult and confusing. We welcome the opportunity to answer your questions.

If you are interested in more information about Social Security, visit their web site at http://www.ssa.gov.

Applying for Social Security Disability [“SSD”] benefits is a SLOW and PAINFUL process. We are committed to doing all that we can to help you prevail. We will do a better job for you, and you will be less frustrated, if we work well together.

Here’s what you can do:

Do not call, write or visit any Social Security office unless you check with us first.

Client Telephone Calls. We represent hundreds of people at one time. We have attorneys and staff who are specially trained to assist you. Staff are able to answer most questions but are NOT authorized to give legal advice. Let us know the purpose of your call so that we can respond appropriately.

Client E-Mail and Other Communications. We generally find it more efficient to respond to e-mail messages or other “written” communications from clients. If you have access to a computer, please visit our web site (http://ModicaLawFirm.com) and e-mail us.

Appointments. Although we enjoy seeing our clients, please do not drop by our office without an appointment. When you call to make an appointment, please tell us what you want to discuss so we can plan appropriately. When you come in for an appointment, bring all important papers.

Change in Work Status. If you return to work, communicate with us immediately.

Change of Address. If you move, change your telephone number, or are leaving town for a period of time, please let us know how we can reach you.

Change of Condition. If your condition changes in any significant way (e.g., you are hospitalized or develop new problems), please communicate with us.

Health Insurance Coverage & Medical Treatment. Maintaining health insurance coverage–and getting appropriate medical treatment–is very important, particularly until you are eligible for Medicare. We encourage you to explore whether you are eligible for “affordable” health insurance coverage under a federal law known as the Affordable Care Act. Residents of New York can learn more by visiting http://nystateofhealth.ny.gov/

Unemployment Insurance. When you seek unemployment insurance [“UI”] benefits, you are telling the world that you ARE well enough to work but cannot find work. When you seek SSD benefits, you are telling the world that you cannot perform your job or any other job given your age, education and work history. As you can imagine, collecting UI can be inconsistent with your claim for SSD benefits. Please communicate with us before you file for UI benefits.

Legal Advice. Do not get legal advice from your friends, neighbors or your doctor. Do not discuss your case or compare it with others, as no two cases are alike. Because you have asked us to represent you, any advice on your case should come from us.

Keep a File Related to Your Case. Keep a file with all important papers related to your case.

Loans. It is illegal and unethical for us to make loans or give advances on anticipated payments. We are sympathetic, but we cannot violate the law.

Letters from Social Security. When you receive these, communicate with us.

Referrals by Treating Physician. Communicate with our office if your treating physician refers you to another doctor (specialist) for testing or treatment.

Hearings. Not all cases require a hearing to be resolved successfully. If a hearing is necessary, prepare a “head to toe” description of all the difficulties you are having. We will meet with you several days before so that you are prepared fully to testify.

IT OFTEN TAKES 20 MONTHS OR MORE FOR A HEARING TO BE SCHEDULED FROM THE DATE THAT THE SOCIAL SECURITY ADMINISTRATION [“SSA”] ACKNOWLEDGES THAT WE HAVE REQUESTED A HEARING. SSA WILL SHORTEN THE WAITING PERIOD IF YOU HAVE A DIRE FINANCIAL NEED AS THEY DEFINE IT. IF YOU EXPERIENCE A DIRE FINANCIAL NEED, PLEASE PROVIDE US WITH THE SUPPORTING DOCUMENTATION SO THAT WE CAN ASK SSA TO MOVE UP THE HEARING DATE.

Disability Certificates. If you receive a Return to Work slip from your treating physician, DO NOT give it to Social Security. Give us a copy. If you feel you are unable to work, be sure to discuss this with your doctor and, if possible, get an appropriate letter.

Waiting Period. You will NOT be paid for the first five (5) months that you are disabled, even if the Social Security Administration grants your application.

Workers’ Compensation. If your disability was caused by work, then you may be entitled to Workers’ Compensation [“WC”] benefits. Be sure to check with us if this applies to you. Depending on the amount of WC benefits you collect, your SSD benefit may be reduced. If we are NOT representing you in your WC case, get us documents that show the amount of WC benefit you are receiving.

Bankruptcy Proceedings. If you are contemplating filing for bankruptcy, consult with us before filing. This is VERY important if you have a personal injury lawsuit.

ACCES-VR. We highly recommended that you contact a government agency known as Adult Career and Continuing Education Services-Vocational Rehabilitation (ACCES-VR). They will help determine whether there is new work that you may be able to perform given your age, education, work history, skills, physical and mental limitations. They can help you get more education or training so that you are a better candidate for new work. THERE IS NO COST FOR THEIR SERVICES. Here is a link which explains what they do: http://www.acces.nysed.gov/vr

In our experience, engaging with ACCES-VR is always positive. If they help you get more education or training that leads to new employment, this is better than collecting SSD. Depending on when you start this new work, your SSD case still may be viable. If ACCES-VR is unable to find suitable work for you, a Social Security Judge is more likely to approve your application for SSD benefits.

For more information, call ACCES-VR (585) 238-2900 or visit http://www.acces.nysed.gov/vr/rochester-district-office. WE DO NOT RECOMMEND THAT YOU TELL ACCES-VR THAT WE REFERRED YOU TO THEM. SOME ACCES-VR EMPLOYEES BELIEVE THAT PEOPLE REFERRED TO THEM BY LAWYERS ARE NOT GENUINELY INTERESTED IN WORKING.